Illinois, Rhode Island Cities Among Riskiest Muni Credits – S&P DJI

By Michael Aneiro

As the muni market looks for lessons to draw from Detroit’s bankruptcy filing, S&P Dow Jones Indices today looks for any other municipalities that could be most at risk of following in Detroit’s footsteps. Using only the simple gauge that bonds with higher yields are riskier than bonds with lower yields, S&P DJI comes up with the following list of the highest-yielding bond issues in the S&P Municipal Bond Index:

Maverick County, TX

Scranton, PA

Central Falls, RI

Northern Mariana Islands

Woonsocket, RI

Bellwood, IL

Riverdale, IL

Harvey, IL

S&P DJI says the yields of the bonds from these issuers in this list range from 7% to over 9.25%. By contrast, it says the average yield for investment grade municipal bonds across the muni market is 3.12%.

Amey Stone is Barron’s Income Investing blogger and Current Yield columnist. She was formerly a managing editor at CBS MoneyWatch, MSN Money and AOL DailyFinance. Her responsibilities included overseeing market coverage and personal finance topics. Prior to those roles, she was a senior writer at BusinessWeek where she authored the Street Wise column online and contributed to the magazine’s Inside Wall Street column. Topics covered included economics, corporate finance, Fed policy, municipal bonds, mutual funds and dividend investing. She co-authored King of Capital, a biography of Citigroup Chairman Sandy Weill. She is a graduate of Yale University and Columbia University’s Graduate School of Journalism.